Toshiba Agrees To Buy Fujitsu’s Disk Drive Unit

Toshiba (TOSBF.PK) this morning announced a deal to acquire control of Fujitsu ’s (FJTSY.PK) hard-disk drive business, with completion of the deal expected in the June quarter. Fujitsu will put its drive-related operations into a new company; Toshiba will initially take an 80% stake in the new business, with Fujitsu to maintain a stake of under 20% temporarily. Eventually, the new unit will be 100% owned by Toshiba. Terms of the deal weren’t announced; Bloomberg reports that the companies have not agreed on a price. (Maybe it is just me, but…how can you announce a deal for which there is no agreement on price?) The deal is good news for the drive industry, which has been struggling with excess capacity. Among the U.S. drive companies, Seagate (STX) shares today are off 5 cents, or 1.1%, to $4.32, while Western Digital (WDC) 67 cents, or 4%, to $16.01. (link)